"The system is incredibly flawed. If you get shot in the leg, you then get a subsequent infection which causes you to lose the leg, do you lose compensation for the loss of the leg or do you only get it for the gunshot which would probably be only a few thousand pounds?

"It seems perverse that people can vote their own pay awards then look at people who have risked everything and they take their award from them.

"It seems awful, it is almost car-crash politics when they start doing something like this, especially on a day when they are repatriating four brave people who are coming home."

Mr Weston called for the military to receive compensation payments at the same level as those paid to injured police officers and firefighters.

A statement from the Ministry of Defence said: "The MoD is appealing in order to clarify an earlier judgment about how the scheme is administered, and to protect the key principle of the scheme: the most compensation for the most seriously injured."

The deaths of two more British soldiers in Afghanistan were announced on Monday, bringing the number killed in July to 22.

More than 100 casualties have been evacuated during Operation Panther’s Claw. Despite ministers’ pledges to improve the treatment of Armed Forces personnel, the MoD will go to the High Court today seeking to cut the compensation due to two wounded servicemen.

Last week Sir John Major, the former prime minister, accused the Government of not doing enough for wounded troops in an article for The Daily Telegraph.

The MoD has faced repeated criticism of the way it deals with wounded personnel.

It paid out £84 million in civil compensation last year, but, by contrast, campaigners say men and women wounded in combat have to struggle to win even modest payments.

Controversially, the Armed Forces Compensation Scheme puts the burden of proof on claimants, who must provide evidence that they were injured doing their duty. Campaigners say many claims that would have been allowed under the old rules are now blocked. MoD figures show that around a third of all claims are now rejected.

Maj Gen Patrick Cordingley, the former commander of the 7th Armoured Brigade, said: “What I think is sad is you have to fight for compensation, when you are actually not talking about that many people and not that much money.”

Simon Weston, the former Guardsman severely injured in the Falklands, said: “The compensation scheme is one where veterans have to fight for everything. You get nothing by right in this country.”

Lord Morris of Manchester, a former Labour minister, said the review of the scheme must reverse the burden of proof.

There are also concerns about the way compensation is awarded using a complex “tariff” system.

Although the MoD last year doubled the maximum lump-sum payment to £570,000, only the most catastrophic injuries attain that sum. Even the loss of both arms or total blindness would not qualify.

One particular concern is the treatment of mental health disorders. Compensation for psychological injury is effectively capped at £48,875.

In addition, all claims must be made within five years of sustaining or learning of the injury or leaving the Forces.

Lt Col Church, said the system failed to account for the combined effect of injuries. “The whole issue of time limits is completely unnecessary and undignified,” he said.

Gen Sir Mike Jackson, the former head of the Army, said the approach taken was not “one of generosity”. He added: “I suspect that they are keeping costs down as well.”

Kevan Jones, the Defence Minister, last night said many of the campaign’s demands were being met.

“It has been widely recognised, including by Sir John Major, that the new scheme is an improvement on what was there before,” he said. “We have doubled the lump sum compensation payments and have agreed to a whole-scheme review next year that will be open to independent scrutiny.”